Indivior slumps as patent dispute rises US generic spectre

The RB spin out will appeal against the ruling

UK drugmaker Indivior suffered a major setback last week after a US patent ruling undermined one of its key products.

The UK-listed company - which was spun out of Reckitt Benckiser three years ago - generates the bulk of its revenues from Suboxone (buprenorphine and naloxone), an oral film product used for the treatment of opioid dependence. It has been poleaxed by the verdict in a Delaware district court, which could clear the way for generic copies of the drug in the US.

Indivior said it plans to appeal the decision, which held that three US patents on Suboxone were valid but that a generic from Indian drugmaker Dr Reddy's Laboratories drug does not infringe them.

Two other generics - from Watson Labs and Par Pharmaceuticals - were deemed not to infringe one patent, but the court declined a motion by the generic companies to re-open a 2016 judgment, which held that their products infringed Suboxone's intellectual property. As it stands, those two companies remain blocked from selling generic Suboxone until 2024, pending any appeal.

Shaun Thaxter, Indivior's CEO, told investors that the appeals process could take between 12 and 18 months and that "the probability of a well-known, well-characterised risk to our business has increased".

Investors took fright, mindful of the fact that US Suboxone sales account for 80% of Indivior's sales, and shares in the company closed down 38% on Friday in the wake of the revelation.

He said that Dr Reddy's has not yet been granted FDA approval for its generic Suboxone product - and neither has any other generic drugmaker - and stressed that if the Indian company launches ahead of the appeal outcome it would be at-risk of damages if Indivior's appeal is successful.

Dr Reddy's received a complete response letter (CRL) from the FDA for its marketing application for the generic, setting back any approval, but just how long that delay could extend is unknown.

Thaxter insisted that Indivior is still in a strong position, not least as the company's pipeline could shortly deliver a key new product in RBP-6000, a subcutaneous depot formulation of buprenorphine for treating opioid dependence.

RBP-6000 is due for an FDA verdict by November 30 and according to Indivior could have $1bn or more sales potential. In the first half of the year, the company reported total revenues of $553m and is predicting that it will bring in $1.05bn-$1.08bn in 2017 as a whole.

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